4 Painless Changes That Freed Up Money for Debt Reduction

Small wins add up to big wins. A few times per month I ask myself: “I wonder how I could squeeze an extra hundred bucks out of the budget to throw at the debt?”

I’ll have ideas here and there, but other than the obvious stuff (dropping cable TV, getting a cheaper cell phone plan, riding my bike all over the place to save gas, eating out less), I rarely have a solid $100 plan come together in my mind.

For some reason a $100 plan came together at 4:45am today. Now, don’t get me wrong – I’m not trying to hype this all as cost-reduction: 60% of this plan was a reallocation. But I still call it a win because I shifted resources to my most important current financial goal (getting out of debt).

1. Canceled Netflix and Hulu Plus: $16.52 per month.

We haven’t watched Netflix in three weeks, and we can still veg out with shows on the networks’ websites, so why pay for these services? We’re wondering if it’s time to sell the TV and be done with it.

Side benefit: the less TV I watch, the earlier I go to bed, the better I feel.

2. Cut my automatic 401k contribution. $58.33 per month toward my highest interest debt.

YNAB makes an automatic contribution to my 401k, but it’s not a matching program. Because I can’t earn the automatic 100% “ROI” from an employer match, it makes more sense to apply the ~$60 per month that was going to the 401k to my highest interest loan (the residential lot at ~10%).

3. Contacted a new local internet provider about connecting to his service. $20 per month.

Apparently there’s a new internet reseller who’s setting up shop in my neighborhood and two others in our city. I have a couple neighbors already on the service, and they say it handles streaming fine for $30 per month. Saves me $20 and feels low risk given our reduced streaming habits.

4. Cut another $10 per month from my fuel budget.

Kate and I have targeted two areas where we can further reduce our car usage: I’ll ride our daughter to her preschool in the bike trailer, and we’ll be driving to the gym less often. Monthly gas savings will come in around 3-4 gallons, or $10 to $12 per month.

This change isn’t strictly about the money: I like the time on the bike and the opportunity to take my little girl to school. The money is a bonus.

Final score:

$16.52 + 58.33 + $20 + $10 = $104.85 per month.

It seems a little trite when people say “Every little bit counts,” but when you can make savings and adjustments to funnel an extra $100 per month to your big goal, it feels like a big win.